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The Role of Distance in Determining International Transport Costs: Evidence from Philippine Import Data

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  • Kuwamori, Hiroshi

Abstract

This paper presents an empirical investigation of the appropriateness of distance as a determinant of international transport costs by using Philippine import data. This study addresses three specific questions. First, does distance really matter in the determination of transport costs? Second, if distance is a significant factor, what is the magnitude of its impact? Third, does the impact of distance on transport costs vary by commodity? Results indicate that while distance is important in determining transport costs, using distance alone as the proxy of international transport costs is insufficient, and such use underestimates the impact of distance on international transport costs. Results also indicate that the impact of distance varies across commodity groups, but it is difficult to precisely determine the direction and the magnitude of this impact.

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File URL: http://ir.ide.go.jp/dspace/bitstream/2344/129/3/ARRIDE_Discussion_No.060_Kuwamori.pdf
File Function: First version, 2006
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Bibliographic Info

Paper provided by Institute of Developing Economies, Japan External Trade Organization(JETRO) in its series IDE Discussion Papers with number 60.

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Date of creation: Apr 2006
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Publication status: Published in IDE Discussion Paper. No. 60. 2006.4
Handle: RePEc:jet:dpaper:dpaper60

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Keywords: Transport costs; Distance; International trade; Imports; Philippines;

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